New housing prices across Canada increased 0.3 per cent in February owing to rising labour and material costs, Statistics Canada reported Friday.

On a year-over-year basis, contractors' selling prices increased 6.2 per cent, down from the 6.5 per cent increase observed in February.

"The increase in new housing prices in Canada slowed in February, following two consecutive months in which the rate of growth was gaining speed," the federal agency said. "This deceleration continues the downward trend that started in September 2006."

Saskatchewan's strong housing market led the country, with builders citing the high cost of materials and a notable labour shortage, Statistics Canada said. Saskatoon recorded an annual price increase of 58.3 per cent — the city's largest recorded increase.

In monthly comparisons, new home prices in Saskatoon rose 4.3 per cent in February over January. Regina's new housing prices in February climbed seven per cent over January.

New February home prices dropped 0.9 per cent in Edmonton and 0.3 per cent in Calgary from the previous month. The federal agency said the slowing housing market is shifting.

"With some migrants leaving the province, there are many resale houses on the market, making for slower new housing sales," Statistics Canada said.

Material, labour and land development costs helped drive up new home prices in Nova Scotia and Newfoundland and Labrador to record levels. St. John's recorded a year-over-year increase of 12.2 per cent while Halifax prices climbed 11.4 per cent.

   New housing price increases
   February 2007 - February 2008 (%)  January 2008 - February 2008 (%)
 Canada  6.2  0.3
 St. John's  12.2  2.9
 Halifax  11.4  0
 Charlottetown  2.4  0
 Saint John, Fredericton and Moncton  2.1  -0.4
 Quebec  4.0  0.5
 Montreal  4.7  1.0
 Ottawa–Gatineau  3.3  1.3
 Toronto and Oshawa  4.4  0.3
 Hamilton  3.6  0.8
 St. Catharines–Niagara  5.3  1.9
 Kitchener  2.0  -0.1
 London  3.7  0
 Windsor  0.3  0.3
 Greater Sudbury and Thunder Bay  6.3  1.2
 Winnipeg  14.5  0.1
 Regina  28.6  7.0
 Saskatoon  58.3  4.3
 Calgary  5.2  -0.3 
 Edmonton  14.8  -0.9
 Vancouver  6.6  0.2
 Victoria  1.6  0